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Star Scientific

August 26, 2011


Appeal from the United States District Court for the District of Maryland in consolidated case nos. 01-CV-1504 and 02-CV-2504, Senior Judge Marvin J. Garbis.

The opinion of the court was delivered by: Rader, Chief Judge,

Before RADER, Chief Judge, LINN, and DYK Circuit Judges.

Opinion for the court filed by Chief Judge RADER.

Opinion concurring-in-part and dissenting-in-part filed by

Appellant Star Scientific, Inc. ("Star") appeals the denial of its motion for judgment as a matter of law ("JMOL") and in the alternative a new trial after a jury verdict of non-infringement and invalidity of U.S. Patent Nos. 6,202,649 ("'649 patent") and 6,425,401 ("'401 patent") (collectively, "Williams patents"). Star Scientific, Inc. v. R.J. Reynolds Tobacco Co., No. 8:01-cv-1504, Dkt. No. 1146 (D. Md. Dec. 21, 2009). This court affirms the denial of Star's JMOL of infringement and the denial of Star's motion for a new trial but reverses the district court's denial of Star's JMOL on validity.


Star is the exclusive licensee of the Williams patents, which claim tobacco curing methods. Curing dries the tobacco leaves before shipment to tobacco companies. One prior art curing method-"air curing"-places tobacco leaves in a barn to dry without any added heat. In the United States, curing is generally performed in heated curing barns through a method called "flue curing," which uses diesel gas or propane gas heaters.

Circuit Judge DYK.

Until the 1970s, most curing occurred in indirect-fired barns that heated and dried the tobacco in an environment separated from the exhaust gases released by the heaters. In the 1970s, in an effort to save money, tobacco farmers switched to direct-fired barns, which mixed the combustion exhaust with the curing tobacco. The combustion gases (including carbon monoxide, carbon dioxide, and water vapor) can create an anaerobic, or oxygen-free, environment. This anaerobic environment in direct-fired barns can lead to the formation of a family of chemical compounds called tobacco-specific nitrosamines ("TSNAs") on curing tobacco leaves. Tobacco can acquire four varieties of TSNAs, known by the abbreviations NNN, NNK, NAB, and NAT.

These TSNAs arise because anaerobic conditions stimulate microbes on tobacco plants to produce the enzyme, nitrate reductase, which converts nitrate to nitrite and nitric oxide. Nitric oxide reacts with precursor tobacco alkaloids to form TSNAs.

Because some TSNAs are known carcinogens, tobacco companies have long sought curing methods that minimize or eliminate TSNA formation on cured tobacco plants. The Williams patents claim a tobacco curing method that "substantially prevent[s]" the formation of at least one TSNA during curing. Star employee Jonnie Williams ("Williams") is the named inventor.

Star first filed a provisional patent application on September 15, 1998. On September 15, 1999, Star filed a non-provisional application, which issued on March 20, 2001 as the '649 patent. The application leading to the '401 patent is a continuation of the application that matured into the '649 patent. In the time between the provisional application and the non-provisional application, Williams developed the "StarCure" process, the commercial embodiment of the invention. The parties agree the StarCure process is the best mode of practicing the claimed invention.

The Williams patents work with air curing and both indirect and direct flue curing methods. '649 patentcol.2

ll.53-66; col.3 ll.1-24. Williams' method creates a "controlled environment" that controls "at least one of humidity, rate of temperature exchange, temperature, airflow, CO [carbon monoxide] level, CO2 [carbon dioxide] level, O2 [oxygen] level, and arrangement of the tobacco plant." Id. at Abstract. The Williams patents define "controlling the conditions" as "determining and selecting an appropriate humidity, rate of temperature exchange, temperature, airflow, CO level, CO2 level, O2 level, and arrangement of the tobacco leaves to prevent or reduce the formation of at least one TSNA." Id. col.5 ll.65-68, col.6 ll.1-4. The Williams patents teach that "the practice of tobacco curing is more of an art than a science, because curing conditions during any given cure must be adjusted to take into account" many variables. Id. col.6 ll.35-37. Those variables include "differences in leaves harvested from various stalk positions, difference among curing barns in terms of where they are used" and more. Id. col.6 ll.35-41. However, the Williams patents elaborate that "one of ordinary skill in the art of tobacco curing would understand that the outer parameters of the present invention, in its broadest forms, are variable to a certain extent depending on the precise confluence of [these numerous factors] for any given harvest." Id. col.6


In general, the Williams patents posit that sustaining an aerobic environment during tobacco curing will prevent TSNA formation. Id. col.7 ll.53-55. For purposes of infringement, the parties agreed that the combined elements of claims 4 and 12 of the '649 patent were representative. J.A. at 46387-90. Those claims recite:

4. A process of substantially preventing the formation of at least one nitrosamine in a harvested tobacco plant, the process comprising:

drying at least a portion of the plant, while said portion is uncured, yellow, and in a state susceptible to having the formation of nitrosamines arrested, in a controlled environment and for a time sufficient to substantially prevent the formation of said at least one nitrosamine;

wherein said controlled environment comprises air free of combustion exhaust gases and an airflow sufficient to substantially prevent an anaerobic condition around the vicinity of said plant portion; and

wherein said controlled environment is provided by controlling at least one of humidity, temperature, and airflow.

'649 patent col.20 ll.18-33 (emphasis added).

12. The process according to claim 4, wherein the treatment time is from about 48 hours up to about 2 weeks.

Id. col.20 ll.50-51 (emphasis added).

From 1998 through 2001, Star had agreements with Brown & Williamson to cure low-TSNA tobacco using Williams' patented method. Star made millions of dollars in licensing fees for rights to the Williams patents. However, defendants-appellees R.J. Reynolds Tobacco Company ("RJR") terminated those agreements with Star upon acquisition of Brown & Williamson.

RJR conducted its own research to develop curing methods to minimize TSNA formation on cured tobacco. One RJR researcher, David Peele ("Peele"), filed a patent application in April of 1999, which issued as U.S. Patent No. 6,805,134 ("Peele patent" or "'134 patent") on October 19, 2004.

The Peele patent claims a method of reducing TSNA formation by using "a heating source that is not a direct-fire heating source" to "avoid contact with, or exposure to, tobacco being subjected to flue-curing processing steps with nitric oxide gases." '134 patent col.3 ll.37-47. To reduce exposure of curing tobacco leaves to nitric oxide gases, Peele provides a method of retrofitting direct-fire flue curing barns with heat exchangers to effectively turn them into indirect-fire flue curing barns ("Peele method"). By 2000, RJR required every farmer in its chain to retrofit their barns in accordance with the Peele method.

On May 23, 2001, Star filed a complaint against RJR, alleging infringement of the '649 patent, and subsequently filed an amended complaint further alleging infringement of the '401 patent. RJR denied infringement and claimed both patents were unenforceable for inequitable conduct, and invalid for anticipation, obviousness, indefiniteness, and failure to disclose the inventor's best mode.

After a bench trial, the district court held the Williams patents unenforceable for inequitable conduct and granted summary judgment of invalidity for indefiniteness. Star Scientific, Inc. v. R.J. Reynolds Tobacco Co., No. 8:01-cv-1504, Dkt. No. 712, slip op. at 46 (D. Md. June 26, 2007) (finding the Williams patents unenforceable for inequitable conduct based on the nondisclosure of a document ("Burton letter")); Star Scientific, Inc. v. R.J. Reynolds Tobacco Co., No. 8:01-cv-1504, Dkt. No. 711, slip op. at 12-14 (D. Md. June 22, 2007) (finding the Williams patents invalid for indefiniteness). Additionally, the district court granted summary judgment to RJR on the filing date question. Star Scientific, Inc., v. R.J. Reynolds Tobacco Co.,No. 8:01-cv-1504, Dkt. No. 703, slip op. at 1-12 (D. Md. Jan. 19, 2007). The district court found new matter in Star's non-provisional application and held that the Williams patents were entitled to the September 15, 1999 non-provisional filing date and not the September 15, 1998 priority date of the provisional application. Id. Because the non-provisional application includes a new example calling for "air flow of approximately 25,000 CFM," but the provisional application disclosed a minimum airflow of "at least 28,000 CFM," id. at 11, the court found that no reasonable fact finder could find that the 25,000 CFM airflow rate in the non-provisional application had been disclosed in the provisional application. Id. at 12.

On appeal, this court reversed the findings of unenforceability and invalidity. Star Scientific, Inc., v. R.J. Reynolds Tobacco Co., 537 F.3d 1357 (Fed. Cir. 2008) (reh'g en banc denied Oct. 22, 2008) ("Star I"). This court held that the claim term "anaerobic condition" was not indefinite and consequently reversed the district court's grant of summary judgment of invalidity. Id. at 1371. This court also found that the Williams patents were not unenforceable for inequitable conduct. Id. at 1365. In reversing the district court's inequitable conduct finding, this court held that RJR failed to show the withheld prior art, including the Burton letter, renders either of the Williams patents unenforceable. Id. At that time, this court did not review the district court's priority date determination. This court also did not address anticipation and best mode because the trial court denied RJR's summary judgment motions on those grounds. Id. at 1365 n.6. Therefore, this court remanded this case to the district court for proceedings on infringement ("Star II"). Id. at 1373.

On remand, Star II featured a 20-day jury trial with 24 witnesses and over 4,000 pages of transcript. Despite this court's decision in Star I that the Williams patents were not unenforceable for inequitable conduct, RJR's attorneys continually argued, particularly during closing argument, that Star's failure to produce the Burton letter to the United States Patent and Trademark Office ("Patent Office") was significant evidence in support of invalidity. J.A. at 46806-07 ("The Burton letter is again from an invalidity standpoint. . . . The important point here is this was information the Patent Office did not have in front of it."). RJR projected a slide show for the jury during its closing argument; one slide showed a shadowy figure holding a piece of paper labeled "Burton Letter" behind his back ("Burton slide"):

J.A. at 43788.

RJR's primary invalidity expert, Dr. Lambert Otten ("Dr. Otten"), opined that the Williams patents were obvious in light of the combination of a review article by Anna Wiernik et al., titled "Effect of Air-Curing on the Chemical Composition of Tobacco" ("Wiernik") and Japanese Patent No. 51-144535, titled "Method for Curing Domestic Tobacco Leaves," with the named inventor Hideyuki Tohno ("Tohno"). Dr. Otten further testified that three prior art references anticipate the Williams patents: (1) the Peele method; (2) an alleged public use at the ...

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